First, the bankruptcy of the parent company may lead to the dissolution and liquidation of the subsidiary. Because the parent company occupies most or even all of the shares of the subsidiary, the parent company can dissolve the subsidiary by convening the shareholders' meeting or shareholders' meeting of the subsidiary in accordance with legal procedures, and clean up, dispose of and distribute the property of the subsidiary, thus ending its creditor-debtor relationship, eliminating the legal person status of the subsidiary and recovering the remaining property of the subsidiary for bankruptcy liquidation.
Secondly, the bankruptcy of the parent company does not necessarily lead to the demise of the subsidiary. The parent company can transfer the shares of its subsidiaries on the basis of evaluation, and the proceeds from the transfer will be included in the bankruptcy property, but the legal person status of the subsidiaries will remain unchanged and the shareholding structure of the subsidiaries will change.
Legal objectivity:
Article 14 of the Company Law of People's Republic of China (PRC)? Branches and subsidiaries may set up branches. The establishment of a branch company shall apply to the company registration authority for registration and obtain a business license. A branch company does not have legal person status, and its civil liability shall be borne by the company.
A company may set up subsidiaries, which have legal personality and independently bear civil liabilities according to law.
Article 30 of the Enterprise Bankruptcy Law of the People's Republic of China? All the property belonging to the debtor when the bankruptcy application is accepted, as well as the property acquired by the debtor after the bankruptcy application is accepted and before the end of the bankruptcy procedure, are the property of the debtor.